Send me real-time posts from this site at my email
Fan Yang

GBP/JPY Awaiting Breakout from Range

The GBP/JPY has rallied to new highs on the year on the back of a weak JPY. The BoJ's recent addition of stimulus and Japan's unexpected fall into recession in Q3 has pressured the JPY to be the weakest major currency.

While GBP/JPY made a new high at 184.66, it is also consolidating above the 108.07 handle - let's just say 108.00.

GBP/JPY 4H Chart 11/18(click to enlarge)

The 4H chart also shows a rising trendline from mid-October's low of 168 coming up to support price. So, if price can hold above 182.00 and push above 184.66, we should see another leg up in the GBP/JPY. The width of the current consolidation is about 360 pips wide. A break above 184.66 thus opens up another 360 pips higher, toward the 188.25 area - let's say 188.00. 

A break below 181 however, breaks a couple of support factors and suggests a bearish correction. A 360 pip projection lower targets the 177.40 area. However, we probably should expect buyers above this handle if the GBP/JPY is to continue its uptrend. We should watch how a subsequent pullback reacts to the 183.00 handle. If it is able to clear it, the bullish outlook is revived. Otherwise, holding below 183.00, GBP/JPY would still be in a bearish correction/consolidation mode.

Welcome!!! Is it your First time here?

What are you looking for? Select your points of interest to improve your first-time experience:

Apply & Continue